Philippines

Small Water Impounding Management Project

Report Date: March 2001

Field Survey: November 2000

1. Project Profile and Japan’s ODA Loan

The Philippines

Manila

Cebu

Site Map: The whole of the Philippines Sub-project Site in the Northern Manila

(1) Background
Due to the harsh climate and topography of the Philippines, the country suffers frequent natural calamities,
including droughts and floods, which cause enormous losses in the agricultural sector. The development of
large-scale irrigation had been emphasized, and the development of small-scale irrigation areas was lagging
behind. At that time there was growing concern over disparities in agricultural productivity, the income gap
between rural and urban areas, and the excessive concentration of people in urban areas, which was
harming public order. This was the background to the beginning of the Small Water Impounding
Management (SWIM) Plan, which was based on the Presidential Administrative Decree No.408 in May
1976. The Plan, which covered the whole territory of the Philippines, aimed to reduce flood damage and
make effective use of water resources in applications such as irrigation and power generation in order to
reduce rural poverty and the economic and social gaps between rural and urban areas.

(2) Objectives
The project aimed to build small-scale reservoirs in all parts of the country for multi-purposed utilization of
water resources such as flood control, irrigation, household water supplies, power generation and the
prevention of soil erosion, to make diverse and thereby improve the infrastructure for life and production in
rural areas.

(3) Project Scope

The plan as a whole called for the construction of small-scale multi-purpose reservoirs at 187 locations
between 1982 and 1992, benefiting a total area of 13,000ha. Further construction of facilities for irrigation,
power generation and other uses were to be added as required at each site. At the time of the appraisal, the
portions of the plan scheduled for implementation in 1988 and beyond were to be covered by Japan’s ODA

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loan1. The project was divided into three portions:
A Civil works (construction of access roads, dam base works, dam wall works, sluice gate installation,
drainage outlet installation, construction and installation of irrigation facilities).
B Procurement and installation etc. of generation equipment 2 (generators, transformers, electricity
transmission cables, turbines).
C Consulting services (detailed design and construction supervision).

(4) Borrower/Executing Agency

Republic of the Philippines / Department of Public Works and Highways (DPWH)

(5) Outline of Loan Agreement

Loan Amount/Loan Disbursed Amount
Exchange of Notes/Loan Agreement
Terms and Conditions
Final Disbursement Date
¥3,193 million / ¥2,743 million
December 1987 / January 1988
Interest rate: 3.0%, Repayment period: 30 years (10 years for
grace period), General Untied (consulting services are partial
untied.)
December 1998

2. Results and Evaluation

(1) Relevance
At the time of the appraisal, the targets stated by the Philippine government in its medium-term
development plan (1987 – 1992) were the reduction of poverty, the creation of jobs that would raise
productivity, the realization of fairness and social justice, and the attainment of sustained economic growth.
Through the reduction of flood damage and the efficient direction of water resources to applications such as
irrigation, this project was intended to relieve rural poverty and remedy the economic and social disparities
between urban and rural areas. Thus this project was relevant as plan at the time of the appraisal.
The current medium-term development plan for the Philippines (1999 – 2004) is concerned with the
problems of poverty, particularly in rural areas, and the growing disparities in income, and it addresses the
low level of productivity in the agricultural sector, which is the source of income for most of the poor. The
plan looks beyond flood damage reduction as the effect of the small reservoirs, citing the use of irrigation
for increased rice production and crop diversity, and other water supply functions, as concrete policy tasks.
It also mentions the contribution made by Irrigators Associations (IAs) in the maintenance of irrigation
facilities. This project remains relevant within the framework of current development planning in the
Philippines.

1
At the time of the appraisal in June 1987, there were 187 sub-projects within the project that began in 1982, of which 30
had been completed, 28 were under construction, 48 were in, or had completed, the detailed design process, and 81
locations had not been started.
2
The plan was to procure and install generation equipment (generators, transformers, transmission cables and turbines) at
two sub-project sites (Macagtas SWIP and Caramoan SWIP), but they were excluded from the project at the execution
stage. The reason was that at the times of the feasibility study and the detailed design, the surrounding areas had not
been electrified, but they were electrified before the execution of the project.

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(2) Efficiency
Construction under this project was expected to be completed in 60 months, between January 1989 and
December 1994. However, construction started in May 1993, four years and five months behind schedule,
and was completed in September 2000, after 89 months. The factors behind the delays included the
following:
(a) Deteriorating contractor performance3.
(b) The issuance of change orders due to design changes and contractor demands4.
(c) Land acquisition difficulties5.
(d) Inclement weather.
Project cost was 84% of the initially planned amount (86% for the ODA loan portion). This cost underrun
was apparently due to the devaluation of the Peso.
The irrigation facilities and other facilities were built by the DPWH’s SWIM Project Management Office
(PMO), with limited contributions from and coordination with the National Irrigation Administration (NIA),
the Department of Agriculture (DA), the Bureau of Soil and Water Management (BSWM) and local
government units (LGUs) (see Figure 1: Project Implementation Scheme). This scheme meant that full use
was not made of the extensive experience of the NIA and BSWM in the implementation of irrigation
projects and the organization and training of IAs. In short, the project scope was almost entirely limited to
the hardware side, which was the water management and irrigation reservoirs and their related facilities.
The Philippines side had been expected for the soft elements of the project, in raising agricultural
production and productivity, but the execution of these elements was not always adequate. According to the
executing agency, there was some participation and contribution from beneficiary farmers in the selection
of candidate projects and in the feasibility study and detailed design stages, but the involvement of farmers
was not necessarily deep enough. This was one of reasons of difficulties in land acquisition and the
collection of water usage charges since project completion has not been proceeding well.

3
The DPWH voided its contracts with six contractors for poor performance. Some cases were reported in which
contractors were fired because they were unable to take prompt action to make up for delays despite orders from the
DPWH to do so. In other cases, contractors went bankrupt.
4
The change orders had to be issued because adequate topographic surveys were not carried out at the feasibility study
and detailed design stages. This indicates that the DPWH was unable to exercise adequate control over the project,
because the project was executed 5~10 years after the plans were drawn up, and because the surveyors were employed
as sub-contractors of the consultants.
5
Opposition from landowners and sharecroppers affected by the implementation of the project made it impossible for the
contractors to work, thus the DPWH, local government authorities and other agencies pursued a series of negotiations
with landowners and sharecroppers.

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 Figure 1: Project Implementation scheme

NIA BSWM Beneficiary farmers Local government units

Selection of sub-projects Organization of IAs Support for land

for operation and acquisition negotiations
Implementation of the
maintenance etc. Support for farmers’
feasibility study
organizations
Preparation of the detailed
design

Project Management Office（PMO）

Provision of training
Procurement and management of contractors

(3) Effectiveness
1) Effects of irrigation
The project built irrigation facilities for a planned area of over 2,000ha, which are particularly effective in
allowing cultivation in the dry season. Table 1 shows the farm land usage rates for 15 sub-projects (Small
Water Impounding Projects: SWIP) which were visited in the field survey. The implementation of the
project raised the usage rate from 74.2% to 128.3%.
Considering the fact that the project involved the construction of reservoirs as small water impounding
projects, and considering the availability of irrigation water, it should be possible to raise the average usage
rate to 180%, although there are some differences between the sub-projects (see Table 1). Thus, while the
farmland usage rates now are higher than they would have been without the project, the project has yet to
yield its full potential, and it is still in the development stage.

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 Table 1: Farmland Usage Rates for Each Sub-project
After the project (at the Before the
Farmland usage rates Farmland
time of evaluation) project
usage rate
Project Area
Rainy Dry Rainy when the dry
beneficiary At the time irrigable in
season season season Before season
SWIP sub-project land area of dry season
project irrigable land
Naturally (d) evaluation (e)
Irrigated Irrigated (c)/(d) area is planted
watered (a+b)/(d) (d+e)/(d)
fields (a) fields (b)
fields (c)
（ha） （ha） （ha） （ha） （％） （％） (ha) （％）
1 Sto. Domingo SWIP 25 5 25 32 93.8 78.1 32 200%
2 Maniniog SWIP 80 30 80 80 137.5 100.0 26 133%
3 Masalipit SWIP 80 25 80 80 131.3 100.0 64 180%
4 Bulhao SWIP 33 5 33 33 115.2 100.0 33 200%
5 Gabawan SWIP 39 20 39 39 151.3 100.0 39 200%
6 Macagtas SWIP 270 90 270 270 133.3 100.0 270 200%
7 Inamburakay SWIP 38 20 38 38 152.6 100.0 38 200%
8 Malapong SWIP 60 35 60 60 158.3 100.0 34 157%
9 Balibayon SWIP 67 35 67 67 152.2 100.0 49 173%
10 Florida SWIP 115 70 67 115 160.9 58.3 71 162%
11 Sta. Fe SWIP 39 6 39 39 115.4 100.0 39 200%
12 Nangka SWIP 39 15 39 39 138.5 100.0 19 149%
13 Tugas SWIP 203 150 50 350 100.9 14.3 184 153%
14 Sto. Nino SWIP 70 35 68 70 150.0 97.1 57 181%
15 Campin SWIP 71 4 71 71 105.6 100.0 62 187%
16 San Nicolas SWIP Note 2 54 54 200%
17 Cramoan SWIP Note 2 203 203 200%
18 Polangi SWIP Note 2 31 31 200%
19 Woodland SWIP Note 3 92 59 164%
20 Traciano SWIP Note 3 40 29 173%
21 Lamare 1 SWIP Note 3 21 17 181%
22 Kitao-tao SWIP Note 3 80 44 155%
23 Potot SWIP Note 3 426 426 200%
24 Lagunlong SWIP Note 3 39 31 179%
25 Panlagangan SWIP Note 3 38 14 137%
Total for 15 SWIPs (1-15) 1,229 545 1,026 1,383 128.3 74.2 1,017 174%
Total for 25 SWIPs 2,407 1,925 180%
Source: Field survey results
Notes:
1) These are the results from field surveys of 18 SWIP sub-projects.
2) Not yet in operation.
3) Sub-projects which were not included in the field survey.
4) Farmland usage rate = Actually farmed area/project beneficiary area.

Most sub-projects had been in operation for less than three years, and the irrigation facilities for some of
them were still at the development and functional improvement stage, meaning that the planned economic
benefits had not yet been fully realized at the time of the field survey. The economic internal rate of return
(EIRR) for the site surveyed 15 sub-projects is negative, based on the harvest quantities and unit prices at
the time of the survey. However, if one assumes that farmland usage rates reach the planned levels in future
and the development effects are fully manifested, the EIRR would reach approximately 10%.
The EIRR only calculates the benefits of irrigation, but the project has been confirmed to yield effects such
as flood control, which will be described later in this report. Once such benefits are included in the

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calculation, a higher real value of EIRR can be anticipated.

2) Other project effects

Besides irrigation, this project aimed to use water resources for many purposes, including flood control,
household water supplies, power generation and soil erosion prevention.
For flood control, an interview survey of beneficiary farmers for each sub-project revealed the results
shown in Table 2. Of the 18 evaluated sub-projects, 14 had yielded some degree of flood prevention benefit,
and the area benefiting from flood prevention was 15~20ha in seven locations.
The water regulation function of the reservoirs yielded some benefit for soil erosion control in the same
way as for flood prevention.
It was unable to obtain any data on household water supply for this evaluation. However, it is only a
bi-effect among the overall benefits of the project, and in 25 of the sub-projects no specialized water supply
facilities have been built. The use of water for household supplies appears to be far less important than its
use for irrigation. Therefore, while there appears to have been some benefit to beneficiary residents, we
have not made any quantitative measurement of that benefit.
As the construction of other electrical supply facilities has progressed much further than was anticipated at
the time of the project plan, no generation facilities were installed under this project.
There was no data available on the benefits generated by the project through these effects, thus we have not
recalculated EIRR.

Table 2: Realization of Flood Control Effects

Effect in reducing the value of Beneficiary area
SWIP sub-project
flood damage (ha)
Sto.Domingo SWIP Almost 100% 15
Masalipit SWIP Almost 100% 20
Maniniog SWIP Almost 100% 20
Bulhao SWIP Almost 100% 20
Gabawan SWIP 25∼ 0％ 0
Macagtas SWIP 25∼ 0％ 0
Inamburakay SWIP Almost 100% 20
Tugas SWIP 50∼25％ 15
Sto.Nino SWIP 25∼ 0％ 0
Nangka SWIP 50∼25％ 2
Caramoan SWIP 50∼25％ n.a.
Balibayon SWIP Almost 100% n.a.
Campin SWIP 100∼50％ n.a.
Florida SWIP Almost 100% n.a.
Malapong SWIP Almost 100% n.a.
Polangui SWIP 50∼25％ n.a.
San Nicolas 100∼50％ n.a.
Sta.Fe 25∼ 0％ 0

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(4) Impact
The main effect of this project has been its contribution to increased food production. It is calculated to
have increased the annual rice harvest by 8,140 tons (unhulled weight) by the present6. Beneficiary farmers
have indicated that there have also been effects on employment. As most of the sub-projects are located in
low income areas, the implementation of the irrigation projects and the planting which accompanied some
sub-projects was in itself significant in expanding agricultural and social support services. As a result the
project can be credited with a positive impact on the forms and techniques of farming and the level and
quality of people’s lives.
Table 3 calculates average benefit from sub-projects per hectare for cases in which the project was or was
not implemented. Compared to the case in which the project was not implemented, the implemented case
allowed a dry season crop and approximately quadrupled annual unit crop yield. As a result the project is
calculated to have raised average farming household incomes (for approximately 2,000 beneficiary
farmers) on about 12,500ha of land. The increased income earned by farmers was used for home repairs,
means of transport (jeepneys, motor tricycles etc.), and investment in agricultural equipment etc., which
should have ripple effects in improving living standards and productivity. As mentioned above, the project
was not yielding its full effects by the time of the field survey, but if the facilities are operated properly, it is
estimated that the added value will ultimately rise to approximately 36,000 Pesos/ha.

Table 3: Average Yield from SWIP Sub-project Areas (yield per unit area)
Rainy season Dry season
Yield type Without Without Increase
With Project With Project
Project Project
Farm land （ha） 1.00 1.00 1.00 -
Cultivated area（ha） 1.00 1.00 0.44 -
Irrigated area 1.00 - 0.44 -
Naturally watered area - 1.00 - -
Unit yield (tons/ha) (unhulled)
Irrigated area 4.00 - 3.70 -
Naturally watered area - 2.20 - -
Unit price (Pesos/tone)
Rice price (unhulled) 8,000 8,000 8,000 -
Yield revenue (Pesos)
Irrigated area 32,000 - 13,024 -
Naturally watered area - 17,600 - -
Total revenue (P) 32,000 17,600 13,024 -
Note 1)
Production costs (Pesos)
Irrigated area 19,980 - 8,152 -
Naturally watered area - 13,158 - -
Total production costs (Pesos) 19,980 13,158 8,152 -
Profit (Pesos) 12,020 4,443 4,872 -
Increased profit (Pesos) 7,578 4,872 12,450
Source: Field survey results.
Note: 1) The cost includes the costs of labor within the family.

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The rice yield (tons) based on the 15 sub-projects, as found in this survey, was 13,361 tons for the “with project” case
(9,496 in the rainy season and 3,865 in the dry season). In the “without project” case it was 5,223 tons (rainy season
crop only).

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There were no noteworthy negative environment impacts. According to interviews with beneficiary farmers,
the implementation of this project for irrigation and flood control gave them an awareness of the
importance of water resource management. That will lead in future to farmers securing adequate water
supply in the dry season, and supplying irrigation water more widely in the target irrigation areas.

(5) Sustainability
The operation and maintenance of the facilities built under this project was intended to be transferred to the
farmers’ organizations which benefit from them 7 . However, by January 2001 only eight of the 25
sub-projects had been transferred out of the management of the DPWH, which is the executing agency.
(Seven sub-projects were transferred to IAs and one to the NIA8.) The reason is that, considering the
current status of the irrigation facilities built under this project, the beneficiary farmers are not interested in
taking on the responsibility for their operation and maintenance. In particular, the irrigation channels
require repairs and improvements due to erosion, construction defects and inadequate management after
completion. Furthermore, the low collection rate for irrigation service fees (ISF) and the inadequate supply
of irrigation water in the dry season mean that in some sub-projects it is not possible to irrigate the full
planned area. Problems9 such as unfair distribution of irrigation water, inadequate irrigation management,
and land acquisition have still not been solved.

Table 4 Comparison of Farmland Usage Rates, Average Unit Yield and Collection Rates of ISF
Irrigated area ISF
Farmland Average unit
collection
Sub-Project Rainy season Dry season usage rate yield
rate
(ha) (ha) (%) (ton/ha) (%)
1. Sto. Domingo SWIP 25.0 5.0 93.8 2.50 -
2. Maniniog SWIP 80.0 30.0 137.5 3.00 100
3. Masalipit SWIP 80.0 25.0 131.3 4.00 100
4. Bulhao SWIP 33.0 5.0 115.2 3.25 -
5. Gabawan SWIP 39.0 20.0 151.3 3.30 70
6. Macagtas SWIP 270.0 90.0 133.3 3.75 17
7. Inamburakay SWIP 38.0 20.0 152.6 3.50 65
8. Malapong SWIP 60.0 35.0 158.3 5.00 100
9. Balibayon SWIP 67.0 35.0 152.2 3.20 30-40
10. Florida SWIP 115.0 70.0 160.9 5.50 90-95
11. Sta. Fe SWIP 39.0 6.0 115.4 3.70 -
12. Nangka SWIP 39.0 15.0 138.5 4.50 15
13. Tugas SWIP 203.0 150.0 100.9 4.50 100
14. Sto. Nino SWIP 68.0 35.0 150.0 2.00 25
15. Campin SWIP 71.0 4.0 105.6 3.70 -
Average 81.8 36.3 128.3 3.45
Source: Field survey results.
Notes: 1) Based on survey results for the 15 SWIP sub-projects evaluated.
2) Shaded sub-projects have been formally transferred to IAs.

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At the time of the appraisal, it was thought that transferring sub-project operation and maintenance to farmers’
organizations would be practically difficult, but it could be transferred to Barangay Council (Barangays are equivalent to
hamlets) and managed on the Barangay level.
8
In 1999 the DPWH SWIM-PMO allocated a budget of 20 million Pesos for sub-project maintenance, but the budget was
zero for 2000.
9
The IAs were unable to propose comprehensive civil engineering designs for sub-projects, including resident relocation,
thus no agreement has been reached with residents.

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Table 4 shows farmland usage rates, average unit yields and ISF collection rates for each of the 15
evaluated sub-projects. Of the 15 sub-projects covered by the field survey, five had been formally
transferred to farmers. Compared to those which had not been transferred, the performance of the
transferred sub-projects was generally good, as seen in the indicators10. It is possible that those projects
were transferred to the farmers because they were running well. One problem regarding transfers to IAs is
that the beneficiary farmers had little involvement in the planning and design stages, and therefore they had
little sense of ownership of the facilities. If they had made a positive contribution from the planning stage
onwards, it would have been possible to build facilities based on the accumulated experience of the farmers
of each region.
A manual has been prepared for the operation and maintenance of the sub-project facilities, but as there
was no continued training of the IAs in the use of the manual, its use is limited, partly because there is not
enough sharing of information from the manual within each IA. In 1998, representatives of 25 farmers’
organizations received two days of training at Ateneo University in Manila for the operation and
maintenance of the facilities, and project effects are expected to be manifested gradually, with feedback to
the IA members. The BSWM employed a consultant between July and November 1998 to provide training
in the field on matters such as the operation and maintenance of related facilities and the planning and
management of farmland and water use. At this stage, the sub-projects have been completed in 23 of 25
locations, and if training had been carried out at an earlier stage, it would have been more effective in
encouraging farmers to voluntarily take on the operation of the project.

3. Lessons Learned

In regionally dispersed irrigation and flood control projects, the key to the success of the project is often the
participation of beneficiary farmers in planning decisions from the formation and design stages, and the
nurturing of the farmers’ sense of ownership. A process for reflecting the experience-based ideas of local
farmers to the design of each sub-project should have been built in from an early stage of the project cycle.

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The IAs which handle the operation and maintenance of these sub-projects allocate 50% or more of the collected ISF to
maintenance, and maintenance work on the facilities is carried out as a communal work project (Bayanihan).

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Comparison of Original and Actual Scope
Item Plan Actual
①Project Scope
1. Civil Works
(1) Water dam 25 dams 25 dams
(2) Irrigation 2,510ha 2,374 ha
(3) Irrigation structure 1 Set 1 Set (some changes in the
quantity)
(4) Maintenance 25 points 25 points
2.Procurement and installation of 1 Set Not implemented
power generating equipment
3. Consulting Service Foreign 225 M/M ①Engineering/Consultant
Local 54 M/M (Overall supervising work)
Support 27 M/M Foreign 167.9 M/M
Additional construction work and Local 231.8 M/M
supervision costs were accounted Support 686.6 M/M
separately.

4. Training for IAs 50 persons ②Intermittent consultant (Local)

for each sub-project
(a) Revision of F/S-D/E
275.8M/M
(b) Construction supervision
Senior engineer
875.4 M/M
②Implementation Schedule
1. L/A concluded Jan. 1988 Jan. 1988
2. Procurement of consultant Jan. 1988 ~ Jan. 1989 May 1989 ~ Sep. 1990
3. Consulting Service
3-1 Review of M/P, D/D Jan. 1989 ~ Dec. 1993 Sep. 1990 ~ Jun. 1992
3-2 Engineering service for
Jan. 1989 ~ Dec. 1993 Mar. 1993 ~ Nov. 1998
dam construction
3-3 Post-evaluation Jan. 1989 ~ Dec. 1994 Feb. 1998 ~ Nov. 1998
4.Construction work Jan. 1989 ~ Dec. 1994 May 1993 ~ Sep. 2000
③Project Cost
Foreign currency ¥2,235 million ¥1,965 million
Local currency 283 million peso ¥1,588 million
Total ¥4,218 million ¥3,552 million
ODA Loan portion ¥3,193 million ¥2,745 million
Exchange rate 1 peso ＝ ¥7 Ｎ.Ａ.
(1987)

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